Alumni group’s relationship with firm called unethical

The UNLV Alumni Association accepted money from a student loan consolidation company in a type of relationship that the New York Attorney General's Office has called unethical.

Chase Education Finance paid $40,000 to the alumni association over the last three years before the company canceled the contract in May, the association said in a statement Thursday.

In exchange, the University of Nevada, Las Vegas Alumni Association gave Chase the names and mailing addresses of UNLV alumni and allowed the company to use the alumni association's logo in its promotional material.

The promotional material for Chase's Alumni Loan Consolidation Program did not disclose that the alumni association stood to profit from the arrangement, according to the alumni association.

The arrangement was similar to the one that the University of Nevada, Reno Alumni Association procured with student loan consolidator Nelnet Inc. -- one that the New York Attorney General's Office said violated the trust of alumni.

Through a spokesman, the UNLV Alumni Association said it had "no opinion" on whether it should have disclosed that it received payments from Chase.

New York Attorney General Andrew Cuomo's investigations of the student loan industry has resulted in Nelnet settling for $2 million and the resignations of several top university student aid officers across the country.

Nelnet has agreed to sever its relationship with UNR and about 120 other alumni associations.

Earlier this year, UNR's alumni association turned over records of its dealings with Nelnet to Cuomo's office, including details of the $88,400 it earned from the company, an association representative said this week.

Nevada's two universities weren't involved in any illegal acts -- although such arrangements are now illegal in New York -- but the relationships were unethical on several counts, according to Craig Walton, president of the Nevada Center for Public Ethics.

The universities shouldn't have offered alumni information without consulting the alumni first, he said.

Nor should they have entered into the arrangement to begin with, because alumni had no assurances that the student loan services were the best option for them.

"Somebody should have smelled a rat," he said.

Universities, including UNR and UNLV, also sell their logos and the names of their students to credit card companies, a practice that is legal but also unethical, Walton said.

At UNLV, 161 alumni used Chase's services, according to its alumni association. The figure wasn't available at UNR.